Finance (No. 2) Bill 2026: Private client services

The Finance (No. 2) Bill 2026 contains several measures of direct relevance to private clients, business owners and investors, including the confirmed CGT rate reduction, the new Individual Investment Account, CAT threshold changes and the proposed Derelict Property Tax.

The detail of the Bill matters: timing of disposals, the conditions attaching to the new investment account, estate planning implications and new property tax compliance obligations will all need careful review. 

Capital Gains Tax (CGT) rate change  

From a private client perspective, the Finance (No. 2) Bill 2026 broadly gives legislative effect to the Budget day announcements, but the detail is important. The headline measure is the reduction in the standard CGT rate from 33% to 31% for disposals made on or after 7 October 2026. That is a welcome development for business owners, investors and families planning asset sales, but it also places renewed emphasis on the timing of disposals, completion mechanics and transactions which straddled Budget day. Development land gains are an outlier as they will not benefit from the reduced rate, remaining taxable at 33%.

Savings and investments  

The new Individual Investment Account is potentially the most significant retail investment tax development in the Bill. While the broad framework is attractive — including a €50,000 threshold, a 1% annual charge above that amount and no CGT, or fund exit taxes within the account — the Bill shows that this will be a tightly regulated, provider-administered wrapper rather than a fully flexible investment account. Key conditions include one account per individual, an annual contribution limit, Irish tax residence and PPS requirements, restrictions on eligible investments, no interest on cash balances and detailed rules on excess contributions, transfers, non-residence and death.

The reduction in the rate applying to investment funds and life assurance products from 38% to 35% from 1 January 2027 is also welcome. However, the wider deemed disposal regime is not generally removed by the Bill. In practice, meaningful relief from deemed disposal appears to be concentrated within the new Individual Investment Account, so clients should be careful not to treat this rate reduction as full reform of fund taxation.

Gifts and inheritances  

For succession and estate planning, the CAT threshold increases are modest but useful: Group A increases to €420,000, Group B to €44,000 and Group C to €22,000 for gifts and inheritances taken on or after 7 October 2026. A less high-profile but important clarification is the amendment dealing with certain support, maintenance or education payments after the death of a disponer, which should assist in appropriate family provision planning for minor children, children in full-time education up to age 25 and permanently incapacitated children, where the statutory conditions are met.  

Real Estate taxes  

The proposed Derelict Property Tax is also more than a headline 7% charge; it introduces a substantial compliance regime with registers, appeals, deferrals and credits, which may be relevant for clients holding vacant or undeveloped property. 

RSMs view

There are plenty of positive measures in the Bill, particularly the reductions in CGT and investment tax rates and the increased CAT thresholds. Much of these benefits are subject to satisfying detailed conditions and compliance requirements, making careful planning around investments, disposals, succession and property increasingly important. Property owners also need to consider any potential obligations arising under the new derelict property tax regime.